One of the key aspects of Forex trading is the ability to trade using "leverage". It determines the required margin and amount of funds traders need to have in their trading accounts in order to take a position. Put simply, leverage allows you to take a position of much higher value than the monies deposited in your trading account so in other terms, a higher leverage means a lower margin requirement to place a trade.
How does leverage work?
You have a trading account with GO Markets with a balance of $10,000. If you have a trading leverage of 100:1 and wish to use $1,000 on one single transaction as the margin, then you will have an exposure of $100,000 in your base currency ($1,000) = 100 x $1,000 = $100,000 (trade value). The concept here is that GO Markets have temporarily given you the necessary credit to make the transaction you are interested in making. Without this margin, you would only be able to buy or sell transactions of $1,000 at a time.
Thus, the leverage facility allows you to potentially make large profits from a relatively small initial investment.
It is imperative to understand the risks involved in trading Forex using high leverage and traders must find the appropriate level that suit their trading styles as the effect of leverage is that both gains and losses are magnified.
Many FX traders use Expert Advisor(s) ("EA(s)") to trade on MetaTrader 4, and popular EA(s) often include money management tools designed to place the correct trade volume based on the size of the account. However, not all EA(s) feature these tools so it important that traders manually supervise the trading activities on their accounts and make any margin payments as they become due.
Increased leverage carries a greater risk and the potential to make significant losses on very small movements in the Forex market.
Our GO Markets' MetaTrader 4 platform has been designed to effectively monitor and allow you to control risk exposure. Based on each client's margin requirement, the platform will calculate both the funds needed to retain your current open positions and the funds required to enter into new positions. However, as stated above, it is your own responsibility, not GO Markets’, to continually monitor your positions. If the equity in your trading account falls below the margin requirement, a 'margin call' will ensue, and we may close all your open positions to limit your risk to usable margins.
Due to high level of uncertainty in the currency markets and upcoming potential market volatility, and as a precautionary measure to protect our clients, we are currently offering a maximum leverage of 300:1. Our leverage ratios will remain under review and will continue to adjust as appropriate to prevailing market conditions.
By default, all client accounts are set up using a leverage rate of 100:1 (1%).
According to the account balance, a client may choose a rate between 1:1 (no leverage) to a maximum 300:1.
Please consider which leverage rate is appropriate for your needs. It is important to understand the concept of leverage and how it may impact on your trading.
PLEASE NOTE: Certain currencies attract a higher margin rate irrespective of your account leverage. Some currencies may have a fixed leverage rate, while others (such as exotic currencies), may require up to five (5) times the margin rate of a major currency.
|Avaliable Leverage||Min. Account Balance||Max. Account Balance|
Please complete the form below to request a change to your GO Markets' trading account's leverage ratio. Clearly indicate your MT4 account login number and the desired leverage.
* denotes required field
(*) All GO Markets' trading accounts are set up with the standard leverage of 100:1.
By submitting this leverage change request form, you hereby acknowledge that you understand and are aware that increased leverage carries a large amount of risk to your capital and there is a potential you could sustain a loss greater than, and not limited to, the margin you have deposited with us. You also hereby confirm you understand that an increase in trade leverage can result in severe or total account loss. GO Markets is a non-advisory, general advice only broker, and will not provide you with investment or personal advice. For such advice, you must consult a registered financial advisor. Margin Forex is very high risk and leverage should be used wisely.
Please note the minimum and maximum account balance required at the various leverage bands. You need to keep in mind that if your trading account balance moves into a new leverage band, your leverage will be changed according to the new leverage bands - we will notify you of this. GO Markets reserves the right to change your leverage at any time at our discretion, with or without notice, and close all open positions if the equity in your trading account falls below the margin required to maintain your open positions.
Practice trading for 30 days on our free demo account or open a live account.
Trading Forex and Derivatives carries a high level of risk, including the risk of losing substantially more than your initial expenditure. Also, you do not own or have any rights to the underlying assets. The effect of leverage is that both gains and losses are magnified. You should only trade Forex if you can afford to carry these risks.
GO Markets Pty Ltd does not guarantee the performance or return of capital. You should only trade in risk capital (that is, capital you can afford to lose). Please note that the historical financial performance of any underlying instrument/market is no guarantee or indicator of future performance.
Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved, and seek independent advice if necessary. A Financial Services Guide (FSG) and Product Disclosure Statement (PDS) for our products are available from GO Markets Pty Ltd to download at this website or here, and hard copies can be obtained by contacting the offices at the number above.
Please also note that your call may be recorded for training and monitoring purposes. Any advice provided to you on this website or by our representatives is general advice only, and does not take into account your objectives, financial situation or needs. You should therefore consider the appropriateness of our advice before making any decision about using our services. You should also consider our PDS documents before making any decision about using our products or services.
The information on this site is not directed at residents in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
The GO Markets AFSL authorises us to provide financial services to people in Australia. However, GO Markets complies with the obligations arising from our AFSL in respect of the financial services provided to all of our clients, including those who reside outside of Australia.
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